My first post on CDSL was on 5 Oct 2020👉 Dividend Candidate (#3): CDSL 🤑, mentioning the company’s spectacular performance in Q1 of FY 20-21. The CMP (current market price) on that date was Rs. 482.70/- and the CMP on 30 Apr 2021 is Rs. 810/- ✨.
And that is only part of the good news, the other being that the company has declared a dividend of Rs. 9/- per share doubling the amount declared last year (Rs. 4.5/- per share on Sep 2020).
If you consider it’s IPO issue price in 2017 of Rs. 149/- per share, then it’s over 5x now in 2021 ! But it’s not all been smooth sailing, it was a roller coaster ride. The majority of the gains has been in the pandemic year of 2020 since the historic 23 March 2020 lows.
While writing about equity this caveat need to be mentioned – past performance is no guarantee of future results !
And to quote Peter Lynch “Behind every stock is a company. Find out what it’s doing.”
CDSL is Central Depository Services Ltd, in the business of holding securities in the dematerialised form and enabling their transactions. These securities include equities, debentures, bonds, Exchange Traded Funds (ETFs), units of mutual funds, units of Alternate Investment Funds (AIFs), Certificates of deposit (CDs), commercial papers (CPs), Government Securities (G-Secs), Treasury Bills (TBills), etc.The depository services are a duopoly in India, the only two players being CDSL and NSDL. The latter is not yet listed.
The competition from NSDL is always a threat. The positives being zero debt and the ability to leverage technology.
Disclaimer: This is not investment advice, only an opinion piece. All investments are risky. Please ensure due diligence before making investment decisions.